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ESO and Escrow
Old 02-11-2012, 05:59 AM   #1
Confused about dryer sheets
Join Date: Feb 2012
Posts: 1
ESO and Escrow

Hi All,

I worked for a start-up a few years back that was bought by a larger company. The larger company set a cash value of our stock options rather than roll them into company stock.

Payment of that sum was based on the original contract (all well and good). The initial payment had 50% removed from my vested amount for an escrow account in order to protect the larger company from any fall outs from the recently converted employees.

Here is the wrinkle, new mgmt would never give me any solid information on when that escrow account would be returned to the employees. I sent several emails prior to signing, but it was obvious from a few employees that left that you either sign or find other employment.

I understand that the escrow account is SOP during these types of transitions, but under normal circumstances (no lawsuits from employees) when could one expect that escrow account to be paid back to the employees? If you leave the company, would you still be entitled to your pay-in to the escrow account?

Or can the company just keep it?

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Old 02-11-2012, 06:17 AM   #2
MichaelB's Avatar
Join Date: Jan 2008
Location: Rocky Inlets
Posts: 27,566
I'm not an attorney, and it sounds like you may need one, but it sounds like the terms of the original contract should still be enforceable.
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